Trump’s grade on the economy: Steady B

President Trump’s protectionist trade agenda has economists worried about a downturn. But for now, the Trump economy is robust, according to the Yahoo Finance Trumponomics report card.

The Trump economy has earned a B grade for the last 5 months, according to our assessment, which is based on data provided by Moody’s Analytics on six key measures of the economy. The composition of the grade has changed in recent months, however, in ways that reveal what’s going well in the economy, and what risks remain.

The Yahoo Finance Trumponomics report card measures Trump’s performance on the economy against seven prior first-term presidents at the same point in their presidencies. (Check out our full methodology.) Here’s how the Trump economy compares with that of his predecessors:

Source: Moody’s Analytics, Yahoo Finance

Job growth has been strong under Trump—but it was stronger under Bill Clinton and Jimmy Carter at the same point in their presidencies. Clinton came into office shortly after a recession ended, and the economy powered forward for his entire two terms. Carter’s term began during a muscular recovery, but that petered out by his last year in office. So strong job growth during Trump’s first year or two won’t necessarily persist.

Trump’s term began with the top grade for earnings growth, relative to the other presidents. But he has fallen from first to fourth in that category, the main reason his grade isn’t higher than B. Earnings growth at the 18-month point was stronger under Presidents Obama, George H. W. Bush and Carter. Pay has been picking up this year, but income growth has been a weak link in the economy since the current expansion began in 2009.

Source: Moody’s Analytics, Yahoo Finance

Stocks surged after Trump’s election in 2016, but for most of his term so far, he has ranked fifth out of the seven presidents in the performance of the S&P 500 index. Stocks did better under Obama and H.W. Bush at the same point in their first terms. Trump got a bump in exports in the latest numbers, and he now ranks third out of four presidents (that data only goes back to 1993). But that may have represented a rush to ship goods out of the country before Trump’s tariffs on China kicked in on July 6, which triggered similar retaliatory tariffs on US exports to China. So exports could sag in coming months. The irony is obvious, given Trump’s attacks on free trade.

The most likely way for Trump’s grade to rise is for income and GDP growth to improve. Numbers for second-quarter GDP come out in late July, and forecasts call for growth of 3% or better. If strong enough, it could put Trump in the top spot for that broad measure of the economy. Trump’s grade would be most likely to fall if incomes and exports drop off. Income growth seems more likely to improve than decline, but Trump’s tariffs and other protection measures could definitely hit exports. Trade wars are the gloomiest part of the economic outlook.